What a second Trump presidency might mean for Australia

Donald Trump is returning to the White House, leaving allies like Australia – and rivals like China – wondering what might be coming next.

Trump is both unpredictable and unconventional, so it is hard to know exactly what to expect from a second term in office.

But he has given some strong indications of his plans for the next four years, particularly in areas such as trade and climate policy.

And on some big questions of foreign policy, such as the wars in Ukraine and the Middle East, his positions are well known.

Here’s a quick guide to what Australia can expect – and can’t predict – from Trump’s return.

Will a trade war hit Australian prices?

Trump is a big fan of tariffs. They were a feature of his first term in office and they look set to be at the centre of his second term.

He has floated ideas like a broad 10 per cent tariff on most imports bound for the United States, and hitting China in particular with tariffs of up to 60 per cent.

Trump sees tariffs as serving many purposes, like boosting the competitiveness of American-made products, and as a revenue measure to offset tax cuts.

Australia narrowly avoided being the subject of new tariffs on locally made steel under the first Trump administration, thanks in part to some careful diplomacy at the time.

Ninety-six per cent of Australia’s imports to the US are currently tariff free, under a 20-year-old free trade deal.

But carving Australia out of any broad new global tariffs might take more careful diplomacy.

What could be even more damaging, however, is a bigger trade war between the US and China.

If Trump’s new tariffs spark a trade war, the hit to the global economy could be significant.

Former US ambassador Arthur Sinodinos warned that, as a trading nation, Australia would have little hope of avoiding getting caught in the crossfire.

“If we have international trade wars, that will have an impact on global trade and investment,” he said.

“It will flow on to Australia because of the impact on the Chinese economy, if he is able to enact the full program.”

Trump’s dealings with China could make things tricky for Australia

Another key point of interest for Australia would be how Trump handles relations with China more broadly.

Trump’s first administration was hawkish on China, and Mr Trump has used major speeches to warn “China is circling Taiwan”.

But he has also said he “got along great” with China’s President, Xi Jinping, and had a “very strong relationship with him”.

There have been suggestions many Chinese leaders were hoping Trump would win, suggesting the unpredictability of a second Trump administration would serve their interests.

There has also been speculation Trump might seek a “grand bargain” with Mr Xi.

Foreign policy experts have warned both scenarios – a Trump administration that takes a confrontational approach to China, and one that seeks a new deal with China – could become extremely complicated for Australia.

Another foreign policy question is what a new Trump administration would do on Ukraine.

There are strong reservations within Republican ranks about US funding and military support for Ukraine’s war effort.

Withdrawal of US support could see growing pressure on Australia to step up its own efforts.

Climate efforts may have to go on without the US

Trump has been very clear on his plans on climate policy – by and large, he wants the US out.

His administration will likely again seek to withdraw from the Paris climate agreement, only a few years after the Biden administration reversed Trump’s first withdrawal.

But Mr Trump may go further this time, withdrawing the US from the United Nations’s broader efforts to combat climate change.

Prime Minister Anthony Albanese’s government had sought to make relations on climate and clean energy the ‘third pillar’ of the Australia-United States relationship.

That element of the relationship now appears to be on very shaky ground.

Trump plans to scale up the United States’s production of oil and gas, pushing through approvals of new projects across the country.

And his administration will also seek to unwind government support for many renewables, particularly the wind industry.

Diplomacy gets delicate – and it could be a problem for Rudd

One big question is how the Australian government will manage relations with a new Trump administration.

When Trump was last elected in 2016, then-prime minister Malcolm Turnbull turned to Australian golfer Greg Norman to put him in touch with the president.

Ties between the Australian government and the incoming Trump administration may be more developed, and diplomatic minds will have been planning how to manage the relationship.

But there are some questions.

The current Australian ambassador to the US is Kevin Rudd, and Mr Albanese has already faced questions over whether the former Labor prime minister is the right person to stay on in the role.

Trump previously suggested Mr Rudd was “nasty” and might not remain long if he was re-elected.

Mr Albanese insists he will stay on, despite suggestions from the Coalition he should be pulled from Washington if need be.

Another person backing Mr Rudd is former prime minister Scott Morrison, who now works with consulting firm American Global Strategies.

“Kevin Rudd is doing a fantastic job,” he said, citing his work on the AUKUS agreement since taking on the job.

“I see no reason why you’re making any changes there.”

There is also the question of who the Trump administration will send to Australia to replace outgoing ambassador Caroline Kennedy, which is truly anyone’s guess.

AUKUS expected to endure, but calls to revisit subs deal

One of the central features of the Australia-US relationship, particularly in the defence space, is the AUKUS agreement.

Most foreign policy experts expect the nuclear submarine deal to endure under the Trump administration, given it is reasonably popular among both Democrats and Republicans.

Making sure it stays that way will be a high priority for Australian diplomats in Washington for the next four years.

But the federal government is already facing renewed calls to rethink AUKUS given the second ascendancy of Trump, including from within Labor ranks.

Marcus Strom from lobby group Labor Against War, which has long campaigned against AUKUS, called on the government to dump the deal.

“It is completely untenable for Australia to continue in lock-step with a militarised US government led by an unstable president,” he said.

“Being part of a heavily integrated military alliance with a Trump presidency is dangerous, expensive and counter to the interests of the Australian people.”

The Greens largely agree, with senator Sarah Hanson-Young arguing now is the time to rethink the deal.

© 2020 Australian Broadcasting Corporation. All rights reserved.
ABC Content Disclaimer